Living on a boat isn't such a cheap choice: Taking to the water can be romantic, but the expenses soon mount up

Narrow boat enthusiasts are gathering today for Britain’s biggest canal boat show. And many of those attending the four-day event in Crick, Northamptonshire, will be looking at a boat as a home rather than merely a hobby.

While some take to the water as a lifestyle choice, others see boats as a cheaper alternative to buying or renting a property.

A second-hand 50ft narrow boat – usually suited to a couple – will cost from £30,000 upwards to buy, depending on age and condition.

Work and play: Will and Michelle Graham use their boat as an office and a home

Alan Wildman, chairman of the
Residential Boat Owners’ Association (rboa.org.uk), says: ‘There is no
doubt there are more people living in their boat than there used to be.’

The Association estimates there are
15,000 people living afloat. British Waterways, which controls most of
the inland waterways in the country, estimates that about 6,500 of its
32,000 licensed boats are used as homes.

But it is hard to be precise. Only
some moorings have planning permission for full-time residence, so some
of those living aboard are forced to use temporary moorings and keep a
low profile.

Wildman says: ‘There are not enough residential moorings to go around. Some residents have to keep on the move.’

The Government last year urged local
authorities to invest in new residential moorings as part of plans to
alleviate the growing pressure on housing.

If you are lucky enough to find a residential mooring, costs will vary.

Annual rents in the North may start
at about £2,000, rising to £10,000 to £12,000 a year in London. On top
of this, residents will usually be charged Band A council tax.

An annual British Waterways licence allowing use on canals and rivers will cost £885.25 for a 58ft boat. Go tobritishwaterways.co.uk for details.

Wildman says: ‘You have to look at
living aboard a narrowboat as a lifestyle choice, not as a cheap way to
get a foot on the housing ladder.

‘You have virtually no security of
tenure and might be turfed off a mooring when your contract comes up. It
may seem attractive when you see people sitting by the canal in the sun
sipping wine.

‘But not everyone is cut out to
spending a winter on a narrowboat, lugging fuel on board and having to
empty the toilet tanks when the canal is frozen over.’

Michelle and Will Graham have been
living on their narrowboat for the past five years. The couple live on
Robyn, a 58ft vessel that is also their workplace. The couple run vinyl
print business The Graphics Boat (thegraphicsboat.co.uk) that produces
signs and decals for vans, boats and caravans.

They live in the rear half of the boat, while their print machinery is in the front section.

Michelle, 37, was made redundant from
her job as an accountant about the time they moved on board. And Will,
39, lost his job as a director of a tiling company two years later.

Michelle says: ‘We hired a narrow
boat for a week as a trial. We handed it back on a Saturday and decided
to buy Robyn by the Monday.’

They purchased the boat with savings
and the proceeds of selling Michelle’s flat. Will has retained a house
that he lets to tenants. Rather than living on a fixed mooring, the
couple cruise the Midlands canal network. This means that they do not
have to pay any mooring or marina fees.

However, the couple face other costs. Their annual British Waterways trading licence costs £826.

Another big expense is diesel fuel
for their engine. They rely on this to charge batteries and provide most
of their electricity. They top up with solar panels when weather
permits.

Will says: ‘It now costs us about £1 an hour to run the engine and we absolutely depend on it.’

Every two years the boat has to be lifted out of the water for ‘blacking’ – treating it with a new waterproof coating.

‘However, it won’t give policyholders
cover for personal possessions if they are living aboard – and these
could amount to between £20,000 and £30,000.’

Towergate last year introduced
bespoke cover for those living aboard narrowboats and has just published
a free guide for those considering buying a boat for the first time.
For more information, go to towergateinsurance.co.uk/boat.

Unlike home insurance, the price of
cover is not linked to the postcode where a boat is moored. Standard
rates apply across Britain. ‘It is a different type of risk,’ says
Mills. ‘If people live aboard, the security is often improved.’

Cover typically costs between £3 and £4 for every £1,000 of the value of the boat, plus about £200 for annual contents cover.

Being on the move will cost more

Anyone living aboard has to grapple with complex rules governing the way fuel is taxed. Different rates of duty apply depending on what the diesel in a tank is used for.

When the engine is used to propel the boat, one tax rate applies. But when the engine is run only to provide heating or generate electricity, a lower rate kicks in.

The reduction in duty for this lower rate – so-called ‘red diesel’ – is 46.8p a litre, almost 50p once VAT is taken into account. In practice, boat owners pump the same fuel into the same tank. They then have to declare to the dealer what percentage of the fuel is for ‘domestic use’ and the tax is calculated accordingly.

Alan Wildman, chairman of the Residential Boat Owners’ Association, says: ‘It is down to individuals to declare the proportions of how much fuel they use for which purpose.’

Where a boat stays on a single mooring for the whole year, all of the fuel can be taxed at the lower rate. This can be supported by evidence such as council tax bills or the permanent mooring agreement. But those without an official fixed abode are classed as continuous cruisers and must keep moving.

On average, members of the Association use 40 per cent of their fuel for propulsion.

It recommends keeping a daily log of when the engine has been running and for what purpose.